Google Upbeat About The Future of Mobile Advertising

Depression or boom, good economy or bad economy, if there is one thing that you can bank on, it’s the performance of Google. The internet giant disclosed its first quarter results recently and the numbers were nothing short of incredible. The company saw a 35% rise in net profits ($1.9bn) and a 23% rise in total revenues ($6.7bn).

The lion’s share of Google’s revenues comes from online advertising, which is not very surprising. The company generated $4.4bn from ads on its own sites and $2bn from ads on third party sites. An interesting thing mentioned in the first quarter results was the success of mobile advertising.

Google considers mobile the ‘third axis’ and has asked its developers to focus on mobile advertising and technology. Eric Schmidt, in fact, has gone on record to say that the company encourages its developers to think ‘mobile first’.

Google is benefiting a lot from the growth of smartphones that can access the internet. The company also says that the launch of new products like the Nexus One has boosted the revenues considerably this year. Though no one knows the exact sales figures of Nexus One, it is said to be one of the top selling smartphones on the market today.

Google has been selling the unlocked version of Nexus One for $529 and the locked version, which comes with a T Mobile contract, for $179. Already, the phone works with AT&T Mobility and T Mobile USA’s 3G networks and other major operators like Verizon Wireless and Sprint Nextel are expected to support the device soon.

Google’s mobile operating system Android is also expanding its presence on the market rapidly. As of now, the OS is on 34 devices from 12 different mobile manufacturers. The company says that more than 60,000 Android devices are getting activated every day, which is quite a big number. The Android market now has more than 38,000 mobile applications and the number is growing by the day thanks to mobile app developers all over the world who are religiously working to come up with new, innovative apps.

The Google story can be summed up in just one sentence – so far, so good. Right now, more than anything else, the company seems to be focused on expanding its presence on the mobile market. While it is good news for mobile users, it is not so for Google’s competitors.

Categories: Cell Phone Advertising, Google.

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Verizon to buy Alltel

Alright folks; it’s official. Verizon Wireless has stated that it will buy Alltel for $28.1 billion. Verizon has made a deal according to which it will pay $5.9 billion to Alltel to acquire its equity and assume a whopping $22.2 billion of its debt.

This acquisition will make Verizon Wireless the biggest cellular operator in the U.S. Verizon has 66.8 million subscribers now and by acquiring Alltel, it will add another 13.2 million to its subscriber base, thereby making it 80 million subscribers in total. The current number one operator, AT&T, has around 72 million subscribers.

An interesting aspect to this deal is, Alltel is probably the only company in the corporate history of America to have changed ownership so quickly. Last year, Alltel was acquired by the Texas Pacific Group and the private equity arm of Goldman Sachs for a similar price. This year, it has been acquired by Verizon.

Expectedly, this news has not made a big splash in the market as everyone and his mom knew that this was on the cards. This acquisition tale has been going on for years now and finally, it is official. If you remember, Verizon was actually keen to acquire Alltel last year, but Vodafone, its wireless partner, rejected the deal. But then, Verizon has managed to get what it wanted.

I think this is a perfect set up for Verizon for two reasons. First, both Alltel and Verizon use the same technology – CDMA. Second, Alltel has a good subscriber base in areas which are not covered by Verizon currently. So, it will extend Verizon’s network coverage platform. What do you think?

Categories: All things mobile phones.

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Mobile ads have better recall rates than TV ads

How do you judge the impact of an advertisement? How do you find out if it was effective or not? In most cases, you go by brand recall - the ability of the customer to recall your brand after being shown the ad a few times. Until now, TV was considered the best medium to place ads as it had the highest brand recall rates. But mobile advertising has simply changed everything.

According to reports from analysts, mobile ads have higher recall rates than TV ads. At the recent Mobile Advertising Degree conference, the representatives of Verizon Wireless emphasized the same fact. They also added that despite being costlier, mobile ads are preferred over online ads because they have a phenomenal click through rate.

This is incredible. I’ll explain you why. First, TV has a huge reach. Second, ads in TV are so common that people no longer consider them a problem. Third, a TV screen is more fit for rich ads and watching an ad on a TV screen could be actually fun.

Now, let me compare this with mobile phones. First, a mobile phone, until now, is not considered a primary advertising medium. Second, ads in mobile are considered intrusive by many, so you can’t expect mobile advertisers to start sending ads to all and sundry. Third, watching an ad on a mobile screen, especially a low end mobile phone’s screen, is not exactly a great experience.

Going by what I’ve said above, anyone can say that the odds are stacked against mobile advertising. But guess what? Mobile ads have a phenomenal click through rate of 2% and more, which is way better than online ads.

Now, just imagine. If these kinds of results are possible right now, what could be the case in future when we have more high-end mobile phones, richer ad formats, improved technology, and most importantly, an open-minded society which is not averse to mobile ads? All I can say is one word – unimaginable.

Categories: Cell Phone Advertising.

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Verizon brings live TV to mobile phones

If you are a San Diegan, you can watch live TV right on your mobile phone from now on. How does that sound?

Verizon Wireless has come up with this service which helps you watch TV shows in real time in your mobile phone. Verizon uses Qualcomm’s MediaFlo technology to bring this service to your mobile phone. Incidentally, San Diego happens to be the 58th market to get Verizon’s V Cast Mobile TV service.

Verizon thinks it can attract a lot of subscribers to its live TV service as it offers a variety of networks like NBC, CBS, MTV, FOX, ESPN, and Nickelodeon for users to choose from. The service will cost you anywhere from $13 to $25 and it gives you the choice to watch live TV shows from all the aforementioned networks.

In my opinion, Verizon’s mobile TV service is good enough to attract some subscribers. I think it is way better than watching downloaded video clips on your mobile phone. It’s live TV and people can watch their favorite news channels, sports channels, finance news channels, and other channels on the move which could be really convenient. However, only four of Verizon’s phone models support this live TV service, which I think is a definite downside. You can’t expect everyone to own an LG Voyager, can you? On a side note, I think this move could actually revive the stock price of Qualcomm which has remained stagnant for quite some time now!

Most importantly, if you happen to live in San Diego, check out this service and let me know your thoughts.

Categories: Cell Phone Advertising, All things mobile phones, Mobile TV.

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What does Verizon’s victory in the auction mean to Vodafone?

The impact of the FCC’s 700 MHz auction is amazing. I mean, who would have ever thought that the results of FCC auction could have an impact on the stockholders of Vodafone? Confused? Read on.

Verizon Wireless, in case you don’t know, is a joint venture between Verizon Communications and Vodafone. Now, as we all know, Verizon has won a major chunk of the wireless spectrum in the recently concluded auction. It paid close to an astronomical $5 billion for the licenses it acquired and it has got reflected in the stock prices of Vodafone.

Investec, a prominent South African bank, has advised its clients to sell Vodafone shares as it predicts its dividend payments to be delayed. Now, I’m not a stock market analyst or something. In fact, I have no idea of anything remotely associated with stock market. Could someone explain this?

Categories: All things mobile phones.

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